Advisers call for overhaul of FOS complaints reporting

Advisers are putting pressure on the Financial Ombudsman Service to report its complaints data differently in an effort to stop the same large firms coming out on top.

The FOS reported its six-monthly complaints data last week, with large advice firms Sesame, Openwork, St James’s Place, Positive Solutions and Hargreaves Lansdown listed in the top five.

Sesame was also the most complained-about advice firm for the first six months of the year between 2013 and 2015. Openwork, Hargreaves Lansdown and SJP also regularly feature in the top five.

But the latest report has led to advisers criticising the FOS for releasing data skewed towards large advice firms, meaning small advisers that receive a lot of complaints relative to the size of their business do not come under scrutiny.

Several advisers have posted on Money Marketing calling for the system to be revisited.

Park Financial IFA Ivor Harper says: “Unless you have per capita reporting you are skewed by the fact the size of firm is going to have an effect on the number of complaints that come in.

“A one-man firm working over a fish shop will have far fewer complaints than a big bank, but proportionately, in terms of the number of transactions going through, they may have a far worse record.”

Harper says a per-capita reporting model, giving a complants ratio per adviser per firm would be a more meaningful measure.

The FOS says it is aware businesses want more reporting of its information but it does not collect data related to the size of individual businesses, how many advisers each firm employs or how many customers a firm has.

A spokeswoman says: “The data we share is just one part of a much wider picture and we know financial businesses are much better placed to be able to provide context in relation to their own organisation. We encourage financial businesses to use the data to help inform their work, inc-luding conversations they might have internally or with their own customers.

“We know from consulting on our data publication previously that some financial businesses are keen for us to provide more details based on the information that we can gather and we’ll be looking into this in more detail in the coming months.”

Apfa director general Chris Hannant says the most helpful information advisers can take from the FOS is the reasoning behind its decisions.

He says: “What is more interesting is the qualitative nature of the decisions. That is where the value lies rather than the fact there have been thousands of complaints about payment protection insurance. That is more important and more instructive.”